A Swiss financier and precious metals advocate says silver’s big breakthrough is just beginning.
In a new market update, Matterhorn Asset Management founder Egon von Greyerz says silver is undergoing a fundamental change.
In contrast to the speculation-induced peak in the 1970s, according to Von Greyerz say he doesn’t believe silver witnessed a blow-off.
Instead, he says gold banks’ current attempts to sell paper silver are quickly failing.
“So what does that mean for mainstream investors? Well, it clearly means that silver is just starting to move, and we’re going to see, as I’ve emphasized many times, multiples of the current price.”
Von Greyerz says physical demand is now claiming 50% of production, compared to 10% last year. The increase comes from solar panels, electric cars, electronics and defense needs, including missiles and weapons.
“Will this correct? Of course silver always corrects, but this is not a normal market because it has now turned into a physical market, which is always how it should be, instead of the manipulation we have seen in the paper markets.”
In the long term, Von Greyerz says he believes silver will reach more than $600 per ounce, while gold will exceed $10,000 per ounce.
“Gold is also rising, but as I have been making clear for some time, silver will rise twice as fast as gold in the coming years. Now the gold-silver ratio has risen from over 100 to around 50.
The long-term ratio will probably be around 15 initially, but I wouldn’t be surprised to see even lower as this is a natural level. But now I think the demand is so great and the supply is so minuscule.”
The price of silver rose to $116 on Monday, up 12.5%, marking the biggest one-day increase since 2008.
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